Instructions For Form 720 - Quarterly Federal Excise Tax Return

local government (including essential government use by

Line 3. Nontaxable Use of Undyed Diesel

an Indian tribal government).

Fuel

Claim requirements. The following requirements must

be met:

Ultimate purchasers use line 3d to make claims

for diesel fuel used on a farm for farming

1. The claim must be for diesel fuel sold during a

purposes.

period that is at least 1 week.

CAUTION

2. The amount of the claim must be at least $200. To

Allowable uses. For line 3a, the diesel fuel must have

meet this minimum requirement, amounts from line 6, 7,

been used during the period of claim for type of use 2, 6,

8, and 14e may be combined.

7, 8, or 12. For exported undyed diesel fuel, see

3. Claims must be filed by the last day of the first

Exported taxable fuel on page 10. Type of use 2 does not

quarter following the earliest quarter of the claimant’s

include any personal use or use in a motorboat. Type of

income tax year included in the claim. For example, a

use 8 includes use as heating oil and use in a motorboat.

calendar year income taxpayer’s claim for the first quarter

Line 4. Nontaxable Use of Undyed Kerosene

is due June 30 if filed on Form 8849. However, Form 720

must be filed by April 30.

(Other Than Kerosene Used in Aviation)

If requirements 1-3 above are not met, see Annual

Ultimate purchasers use line 4c to make claims

Claims on page 13.

for kerosene used on a farm for farming

Information to be submitted. For claims on line 6a,

purposes.

CAUTION

attach a separate sheet with the name and TIN of each

Allowable uses. For line 4a, the kerosene must have

governmental unit to whom the diesel fuel was sold and

been used during the period of claim for type of use 2, 6,

the number of gallons sold to each.

7, 8, or 12. For exported undyed kerosene, see Exported

taxable fuel on page 10. Type of use 2 does not include

Line 6b. Sales by Registered Ultimate

any personal use or use in a motorboat. Type of use 8

Vendors of Undyed Diesel Fuel for Use in

includes use as heating oil and use in a motorboat.

Certain Intercity and Local Buses

Exception. Claims for kerosene used in aviation on a

Claimant. For line 6b, the registered ultimate vendor of

farm for farming purposes must be claimed by the

the diesel fuel is eligible to make a claim only if the buyer

ultimate vendor.

waives his or her right to make the claim by providing the

Line 5. Kerosene Used in Commercial

registered ultimate vendor with an unexpired waiver. See

Aviation (Other Than Foreign Trade)

Model Waiver N in Pub. 510. Only one claim may be filed

with respect to any gallon of diesel fuel.

Claimant. The ultimate purchaser of the kerosene used

Claim requirements. The following requirements must

in commercial aviation (other than foreign trade) is

be met:

eligible to make this claim.

1. The claim must be for diesel fuel sold during a

Allowable uses. For lines 5a and 5b, claimant certifies

period that is at least 1 week.

that the right to make the claim has not been waived. If

2. The amount of the claim must be at least $200. To

the claimant buys kerosene partly for use in commercial

meet this minimum requirement, amounts from lines 6, 7,

aviation and partly for use in noncommercial aviation, see

8, and 14e may be combined.

the rules in Notice 2005-80, section 3(e)(3). Only one

3. Claims must be filed by the last day of the first

claim may be filed with respect to any gallon of kerosene

quarter following the earliest quarter of the claimant’s

used in commercial aviation.

income tax year included in the claim. For example, a

Information for Claims on Lines 6 – 10

calendar year income taxpayer’s claim for the first quarter

is due June 30 if filed on Form 8849. However, Form 720

Registration number. To make an ultimate vendor

must be filed by April 30.

claim on lines 6-10, you are required to be registered.

Enter your registration number, including the prefix, on

If requirements 1-3 above are not met, see Annual

the applicable line for your claim. If you are not a

Claims on page 13.

registered, you cannot make a claim at this time. Use

Form 637, Application for Registration (For Certain

Lines 7a and 7b. Sales By Registered

Excise Tax Activities), to apply for one.

Ultimate Vendors of Undyed Kerosene

Required certificates or waivers. The required

(Other Than Kerosene Sold for Use in

certificates or waivers for lines 6-10 are listed in the line

Aviation)

instructions and are available in Pub. 510.

Claimant. For line 7a, the registered ultimate vendor of

Line 6a. Sales By Registered Ultimate

the kerosene is the only person eligible to make this

Vendors of Undyed Diesel Fuel

claim and has obtained the required certificate from the

buyer and has no reason to believe any information in the

Claimant. For line 6a, the registered ultimate vendor of

certificate is false. See Model Certificate P in Pub. 510.

the diesel fuel is the only person eligible to make this

For line 7b, claimant has a statement, if required, that

claim and has obtained the required certificate from the

contains: the date of sale, name and address of the

buyer and has no reason to believe any information in the

buyer, and the number of gallons of kerosene sold to the

certificate is false. See Model Certificate P in Pub. 510.

buyer. For lines 7a and 7b, only one claim may be filed

Only one claim may be filed with respect to any gallon of

with respect to any gallon of kerosene.

diesel fuel.

Allowable sales. The fuel must have been sold during

the Period of claim for the exclusive use by a state or

the Period of claim:

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Instructions For Form 720 - Quarterly Federal Excise Tax Return - 2006 Page 11

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